According to Morgan: “I was communications director at BT for five and a half years. I’ve been communications director at Rolls-Royce for about six months. I don’t think there is a single example where social media has impacted directly on the reputation or share price of either of these significant organisations.”

The phrase I picked up on here was “impacted directly”. What about the indirect impact of social media on a company’s reputation with its customers? Surely if BT or any other organisation continually ignores grievances voiced by customers on social networks then this is surely indicative of a deeper malaise within the company? And that sooner or later those chickens will come home to roost?

“If a subject gains traction in the social media domain, if it is important, it very quickly feeds into the mainstream press. And when the Daily Mail phones to tell you that you’ve got a problem, you know you’ve got a problem. There is a self-alerting mechanism.”

He continues: “For decades, there have been people in pubs all around Britain saying how much they hate BT or how frustrated they are with Virgin Atlantic or whatever. The fact that they now spout their opinions on a social networking site doesn’t make them any more important or more alarming. “

If I’ve understood his comment correctly then – in Morgan’s opinion – BT and Virgin Atlantic customers (or any organisations customers for that matter) are simply annoying oiks whose opinions are worthless. They are an irritating distraction to the main goal of making sure the share price is propped up at all costs.

In which case, the irony will not be lost on Morgan by this story in today’s Mail on Sunday in which his former employer, BT, is, gasp, monitoring and responding to negative comments on social networks – big style. If customers “spouting their opinions on a social networking site” are “neither important nor alarming”, then why is his former employer patently investing heavily in social media monitoring?

And how would Peter Morgan deal with this story if he were still at BT?

What would he do about how the story has been circulated widely online using the very social networks that he appears to regard as unimportant? Or deal with the growing number of comments the story is attracting on the MoS site itself? The bizarre irony of this piece is that most of the people commenting think the MoS has taken a daft perspective on companies paying attention to customer complaints online – but in turn, they are then using the MoS story as a platform to air their grievances about BT generally – but presumably these people are the same kind of “opinion spouters” that have been dismissed as unimportant previously.

On a different subject, anyone thinking of selling a sentiment analysis tool to Peter is also probably wasting their time:

“I’m deeply suspicious of this early warning idea. In most consumer organisations, the time taken between this becoming a good social media story (My note: what’s a bad social media story?) and this becoming a good online news story and the Daily Mail being on the phone is minutes. I think that it is a waste of money to invest in online tracking systems for social media alerting you to problems. Every problem that has come across my desk has travelled too fast for that early warning system to be of help to me.”

As I’ve said already, it appears that Peter Morgan believes dealing with traditional big media is the main priority of a corporate comms department. In which case, he is probably right to argue that using a social media tracking tool as a crisis management early warning system is flawed – but only if you view dealing with traditional big media as the top priority for a corporate comms department. Surely the modern day comms director must pay attention to what customers are saying – wherever they are saying it. And respond appropriately.

Finally: “Your company website is of critical importance. When deciding how to deploy resource, you would be rash to deploy social media at the expense of a principal corporate website. The oldest communications tool of all is frequently ignored.”

Presumably one of the oldest communications tools is the telephone – which as we’ve seen above, is one that Morgan himself seems to ignore too. At least as a two way communication tool.

So, is he a PR dinosaur? Or a voice of sanity? I wonder if he’ll stop by to comment on this post? Given his apparent attitude to social media, I assume he’ll never even be aware of its existence. But I’d be delighted to be proved wrong. I’d even be happy to take a phone call (020 8334 8095).

Comments

er, what about BP then? also missing the point about it’s not just one media ‘winning’ over another, it’s a sometimes complex ecosystem of online presence and comment that adjusts perception over time.

Indeed. I thought he might have just been deliberately provocative for effect – “getting the call from the Daily Mail” seems a rather crude benchmark for determining communication priorities in the 21st century.

Its a traditionalist viewpoint and its not uncommon. The audience for mainstream media is falling month-by-month and we’ll soon see a tipping point where networks of communities have greater impact around and issue – if we haven’t already.

Examples of firms that have seen their reputation (and shareprice) damaged by digital channels aren’t hard to find: BP, Eurostar, Nestle, Toyota and Trafigura etc.

That said, Rolls Royce doesn’t need Social Media as much as we’d like to have them : ) The question of luxury brands and Social is interesting. They’re built around (almost total) non-communication. Exclusivity is the point. Anyways, good luck to Peter, whatever he says. Hope he has another quiet Monday….

Hi Roger – this is Rolls Royce engines, not cars – even so, I agree that for soc med for certain kinds of B2B sectors could have less importance – but even given Peter’s stated priorities (eg shareholders), does he think that no Rolls Royce shareholders aren’t to even a small degree influenced by soc med networks? Or the secondary network effect? I don’t think he needs to spend 000s ££ on soc med just yet – but at least getting some of his team to get Twitter accounts and seeing what might going on wouldn’t exactly break the bank, surely?

An interesting dissection and assessment of Peter Morgan’s comments. As one of the panellists involved in this event, I can assure you that Helen’s reporting is accurate (and you can check other’ comments via the #smexchange hashtag).

My own view is that Peter Morgan is representative of a certain type of communication management that is all about command, control, deference, automatic respect, etc – all those attributes of behaviour of yore.

While there’s nothing wrong with such values, blind support of them along with a mind closed to other possibilities doesn’t bode well for any organization.

On the basis that someone will bring this post and the comments to your attention, Peter, let me ask: how would you answer such criticisms?

Finally, Precise Exchange published a PDF of Helen’s article along with ‘words of widsom’ about social media from the panellists. Well, three of them: no contribution from Peter Morgan. Consistency at least.

In my experience, this is all very straightforward. Well-run social media activity increases web traffic, which has a high conversion ratio – it clearly increases sales. It also improves brand reputation. And for many brands it acts as a way to be relevant (and to communicate at all) to a large demographic of consumers. BT is different to Rolls Royce in its consumer behaviour though.

I’ve had such debates with Peter before, so this won’t be news to him, but I thought worth pointing out as another side of this debate. All the above points should surely affect share price. Just not obviously to those not engaged themselves in the detail.

Before readers feel jilted by RR, consider how Apple uses no social media outreach for its brand. Apple enjoys healthy margins, a reputation for delivering innovative experiences, and with none of the distractions of Twitter from inside Infinity Loop.

Some brands could hardly do better with the baggage of nurturing social networks.

Indeed – but there aren’t many companies that could copy Apple and get away with it. I’d argue Apple enjoys healthy margins, etc because they make bloody good products that people are happy to buy – not because they choose not to participate in soc med to any degree. I’m not saying soc med is a panacea – but Peter appears to saying there is no value at all in it for RR corp comms (and by implication for a lot of big orgs) – I’m just saying that surely starting with some small scale testing of the waters in soc med would be low risk for RR – and they might actually get some value out of it.

I attended the event and to be fair to Peter, it was fairly brave of him to play devil’s advocate in a room that was clearly pro-social media in general. He also was quite enthusiastic about the idea of using social media for internal comms purposes. So he wasn’t necessarily anti-social media in general, just for corporate communications. However, I still disagreed with most of what he said!

To be clear, this is Rolls Royce engines, not cars – so Peter’s audience is clearly B2B – and I take the point that Joe made re: Peter saying he was enthusiastic about soc med for internal comms – I’m just surprised at the apparent blanket dismissal of soc med for corporate comms – surely the overhead of “testing the water” would be so minute that the downside risk would be minimal. Not even being prepared to try it for corp comms does seem a little drastic.

Fairly typical view from the top of a large company. The fact is that a huge lack of understanding exists at the highest levels of many companies. If a brand does not see any value in at least listening to the social space then they deserve whatever they get.

Just a thought on the earlier assertion that: “Examples of firms that have seen their reputation (and shareprice) damaged by digital channels aren’t hard to find: BP, Eurostar, Nestle, Toyota and Trafigura etc.”

What evidence is in the public domain that proves that the digital media had an impact on share price. Damage to reputation does not necessarily always lead to a measurable decline in share price.

As a former head of online for Rolls-Royce, I am not surprised by Peter’s comments. This is a multinational power systems company that operates in a very tightly-defined B2B market with a small set of customers. Its (highly experienced) press team converse daily with, as you might expect, journalists from Flight International et al. Few players, few media outlets. It’s tight. And that’s where I expect Peter is coming from: it’s his immediate line of vision.
What has not been recognised is the potential that social media can deliver to Rolls-Royce in building a number of primary and secondary relationships. A direct means of social engagement can’t deny the fact that R-R’s primary media stakeholders such as FI have blogs themselves, and then you have forums such as PPRUNE which directly discuss R-R products from the “customer’s” perspective (in this case, the pilots). And, by secondary, it has a golden opportunity in the Rolls-Royce Heritage Trust – which also covers the car owners/fans – to build engagement with a wide audience, given its ubiquitous brand awareness outside of this tight customer base that I defined earlier.
There is undoubtedly potential, and maybe the lines of vision need to be opened up to account for them. I can’t comment on whether I would have launched blogs by now if I still worked there… :-)

Paul – thanks for the comment – I with you in that, from the outside, it feels as though there is a great opportunity for RR to at least test the water with social media – just get the sense there is no desire to do event that – though I’d love to be proved wrong.

What I see is the collision of two extreme attitudes, neither of which is useful.

On one hand, the Rolls Royce comms director says “social media is a complete waste of time”. While it may be true for his business, it’s a mistake to believe that this is true for all businesses.

But it’s no wiser to believe that all businesses will benefit equally from social media. That’s not true about TV advertising, PR, or any other communications tactic I can name. Is it heresy to suggest that social media is a tactic like any other, and will be more effective for some businesses than others?

The positions at both poles smack of doctrinaire thinking and unexamined beliefs.

Peter Drucker said “Knowledge has to be improved, challenged, and increased constantly, or it vanishes.”

It’s not only OK for people to challenge our ideas — it’s vital. Social media true believers should welcome Peter Morgan’s comments as an opportunity to improve their knowledge.

Pretend, for a moment, that he is actually 1000 percent right that social media is not smart for Rolls Royce. I’m not saying that he is, but let’s open our minds to this possibility.

Understanding why social media might completely fail for RR would help illuminate where social media’s limitations lie. This would save energy on every future engagement and likely improve everyone’s results. Isn’t the possibility of that sort of learning interesting? Exciting, even?

The only thing I find to be a “complete waste of time” is allowing our pet beliefs to go unexamined.

This is a fascinating discussion in the light of the Airbus 380 issue. Rolls Royce’s approach to communication during this crisis has mirrored its dismissive attitude to social media specifically.

As a traditional B2B/corporate engineering company, of course it’s not naturally an expansive communicator. It’s much more comfortable working hard on technical matters behind the scenes and communicating only when it is operationally essential and with people who are its immediate stakeholders. I understand this. But the approach has caused it unnecessary damage to its share price caused by unceratinty and the willingness of others to fill the information vacuum with damaging speculation and assumptions.

The last two statements from Rolls both resulted in immediate share price jumps. So why didn’t they issue earlier and more frequent updates? I seriously hope that other B2B/corporate organisations learn the lessons and act differently when confronted with future challenges.

Feel free to take a look at my own blog posting which outlines what I believe is a much more effective approach to reputation protection from Qantas

You know what? I regret having made these comments. I think there’s enormous power in social media, and that it is creating a new media environment which we need to learn how to respond to. It must be right that social media’s more important to some companies that others……eg very important for a consumer electronics company – less to a re-insurance broker……and you should not let the social media obsess you. But I hold my hand up! I was unwise enough to agree to be on a panel opposing a couple of social media evangelists and paid the price!

Peter – appreciate you stopping by. Although you may have become a focal point with your original comments, I know for a fact that many people at the time privately agreed with you (they of course wouldn’t say so in public).

I think your point is well made that we are all learning how best to make use of social media. No one has all the answers. Social media is here to stay and we need to work out how much time, effort and resource we need to devote to it.

Thanks. I agree RR’s silence is not good for the brand. At minimum, a simple “we’re very concerned about this and it has our full attention” and some reassurances about their quality record both seem to be called for here. Given the B2B target, would this be best accomplished through mainstream business media, or through social?

I think some people in our business (I am not implying this means you, in any way) conflate the lack of social media skills with the actual problem. RR hasn’t lost $1B in share value because they failed to Tweet. They lost it because their engines failed :-)

IMO, we’re still learning about how social media shapes brand perceptions. Would the right social media crisis management program change the perceptions of their B2B audience? In the near-term my guess is no. In the long-term, I would guess the answer is yes.

An open question: would this program risk spreading fears about RR engines among consumers? I don’t think we know.

[…] of brand sentiment – and be able to spot where comms issues are developing in real time (just think what Peter Morgan at Rolls Royce could have done with this). An example was given this morning about how the tool could be used to monitor reaction to tube […]